Ep. 10: INTERVIEW - Leo and Oliver Kremer on Building a Burrito Empire at Dos Toros

 
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Leo and Oliver Kremer on Building a Burrito Empire at Dos Toros | Idea to Startup Podcast Episode 10 | Convert audio-to-text with Sonix

Brian Scordato:
Hello. This is Brian Scordato and welcome to the Idea to Startup podcast brought to you by Tacklebox. Tacklebox is an accelerator program for pre-product founders with full time jobs. Applications are open for our July 15th cohort that is in New York City. Just apply at gettacklebox.com. Okay onto the good stuff. Today we're talking burritos. Specifically the best burritos I've ever had in my life. We've got the founders of Dos Toros on the podcast Leo and Oliver. Two brothers from the West Coast who brought mission style burritos to New York and now to Chicago too.

Brian Scordato:
This story is a great one. Leo and Oliver knew what a great burrito needed to taste like, but they didn't know a ton else about starting a restaurant. In the ultra competitive New York City Food Market, they turned this idea for a mission style burrito into 17 locations a fast growing catering business and they've somehow kept quality and culture consistent and amazing.

Brian Scordato:
There are tons of lessons in here. On testing products, building a brand, evolving the business as you grow, saying no to things that seem like you should say yes to, and a whole lot of others. I hope you all enjoy and have a great week.

Brian Scordato:
So we're here with Leo and Oliver the founders of Dos Toros. I'm super excited aren't you guys today. I'm excited to hear the story of how this got going so for people who don't know what it does to us.

Dos Toros | Leo:
We ask ourselves that question, often. Dos Toros is a San Fransisco Bay area inspired Taqueria. It is very simply trying to bring high level burritos to New York City and now Chicago, as well as tacos & quesadillas and do it in a way that is really premium and I think best in class and also with strong sustainability and hopefully a strong culture and a really compelling brand.

Brian Scordato:
Awesome. Love that. So where I want to start is where the idea came from. So you guys, it looks like you started around 2009. So I'd love to know what's going through your heads when your look at the landscape and you're like, "there needs to be a place?" or yeah...tell me, tell me what happened.

Dos Toros | Oliver :
I mean I really started with a passion, deep passion, for consuming whole burritos. And as Leo said we grew up in the San Fransisco Bay Area eating at one specific place in Berkeley, California.

Dos Toros | Leo:
What was it called?

Dos Toros | Oliver :
It was called ,it is called Gordo Taqueria and you've got several locations. The bay in San Fransisco. And really we, we just, you know, were eating this stuff three plus days a week for 15 plus years. And it dawned on us I think fairly early on that we, at the very least, we couldn't get this kind of stuff, these kind of burritos, uh, outside of the Bay Area, let alone ya know California. We were, really just we loved the food and we couldn't find anywhere else.

Dos Toros | Leo:
That's what initially struck us as a huge problem is when you're eating at a place three or four times a week you can't live without it. And how I would like to travel and live elsewhere. How would we do that? I mean how does one do that? It's coming from the Bay Area and with such an intense withdrawal of burritos and you know every trip we go on and get the last meal before you left was a burrito and the first meal upon return would be a burrito.

Dos Toros | Oliver :
And it wasn't just us. We talked a lot of people from the Bay area, that is kind of the thing. When they were living away or been on vacation for an extended period, the first meal they have come back is typically a burrito or a taqueria.

Dos Toros | Leo:
Yeah totally. So super passionate about the cuisine and really hardcore guests and connoisseurs and enjoyed debating the finer points of this Taqueria vs that Taqueria. The carne asada vs the pollo asada versus the chili verde The steaming tortilla versus the grilling. The individual employees versus each other and the Gordo Taqueria where it's like oh this guy rolls really well, but he's a little heavy-handed on this Coca-Cola, but he doesn't drain as well. But I mean, you know, all the different kind of points that you could dissect. I really enjoyed thinking about that and consuming burritos and it just seemed like, you know, it kind of more and more, became apparent that if you could just teleport a good Bay Area Taqueria to New York City or any other city, it would do great because there's nothing else like it. And actually you could do great even just selling burritos to West Coast e, expats. I mean hopefully other people would get excited about it but like at least within NYC, the Southern Californians, if you can just speak of that community.

Brian Scordato:
Sure. So you're in New York. And what were you guys doing at the time when you were like "alright, let's, let's maybe give this a shot?"

Dos Toros | Oliver :
So we moved up to New York in the fall of 2008 with this specific goal and planning. Oh really cool. Yes we actually took a trip out to New York for a couple of weeks with a list of like 45 Mexican restaurants we wanted to try. We made it almost all of them. At the end of the trip I actually saw them was hiring and I took a job, I took a job, I told them I'd go to California for four days, to get my life, my bags and then I moved out to New York at that moment. So we moved out here with the plan to do a tour.

Dos Toros | Leo:
Right, and Part of the we're going to be on that tour of all the best regarded current taquerias in New York City was to just understand that maybe someone was doing this already. Maybe there are some really great places that we're doing so well. So we should not pursue this because it's not working. And we just didn't we didn't feel like we had any areas that were on the level.

Dos Toros | Oliver :
And then it was a question of maybe it's not possible. There's a reason why we can't get over.

Dos Toros | Leo:
We were trying to convince ourselves not to do it on some level because there's a lot of good reasons for us not to do this at this stage. For like, we had zero experience in food service, either one of us running like you know, home like chefs like at all really.

Dos Toros | Oliver :
No family background.

Dos Toros | Leo:
Right. It's just there's nothing, except kind of this observation and passion, Consumer passion and so we're like maybe someone's doing it that's really god. Or maybe there's a reason they didn't like tortilla availability or avocado availability on things like that. And kind of just sort of felt like there wasn't any good reason that it wasn't happening.

Dos Toros | Oliver :
And there were even places that are saying "mission style burritos", they were using our language but then they were kind of...it wasn't mission style burritos.

Dos Toros | Leo:
It wasn't even close.

Dos Toros | Oliver :
It wasn't even like wrapped in foil in a couple cases or just big steps, kind of tip offs that it wasn't the same.

Dos Toros | Leo:
So we couldn't figure it out. Ultimately there wasn't a good reason. And I think that's a business truth that often you maybe you think someone hasn't done something because it's too hard or for whatever reason.

Dos Toros | Oliver :
There must be a good reason, but there's not. And again it was really, the thesis was, if this taqueria we eat at in Berkeley was un New York, it was going to kill.

Dos Toros | Leo:
Right. And I think maybe also part of the reason that it hadn't happened is that the people that were most in position to observe the issue were not well positioned to actually do something about it. You know some you know young urban professionals like going from coast to coast thats like "man I used to have these great burritos, that they just dont have in New York, isn't the right person too typically...

Dos Toros | Oliver :
Well they don't think they are, they could be.

Dos Toros | Leo:
So yeah that's, maybe's thats why.

Brian Scordato:
That's a super interesting point and we get a lot of founders who have a huge opportunity cost. Where it's like, they see an opportunity, they're a lawyer and they've been a lawyer for 10 years they have a big salary. They see an opportunity to say in tacos or whatever, but it's like, is this really like that leap is so huge saying "alright I'm going to get rid of this six figure salary and go after this idea". So I want to know about that suit. So you're like OK this is interesting there's nothing here that fills the need that we know needs to be filled. What are your... You haven't built, you mentioned you haven't, you have no experience in the restaurant industry. What were the first steps. What were you like, "alright let's figure this out". How do you go about that?

Dos Toros | Leo:
Sure. We started cooking.

Dos Toros | Oliver :
That's it. I'm going to start a food business. Start by cooking and seeing whether or not people like it. We hosted a big dinner party. We were kinda cold on it, we're going back and forth on whether it's too crazy of an idea to pursue. And then we went online and got a bunch of recipes for rice, guacamole or chili verde pork right. We went to this. really kind of authentic grocery store with the specialty Mexican items. Invited 25 friends over, cooked this big feast and several, a few of our friends, one, one in particular said it was the best Mexican food he'd ever had.

Brian Scordato:
Really.

Dos Toros | Leo:
I think he was being a little generous at that moment, but that's what we needed to hear. Certainly the consensus was like these are bad.

Dos Toros | Oliver :
It was more, it was a little better then there.

Dos Toros | Leo:
I guess you know it's true. But clearly they weren't bad. They were pretty good. It was our first one. And before you do all this tinkering that we know we're going to do and it just gave us the belief that maybe we can actually wrap our heads.

Brian Scordato:
So you're started to have a little affirmation that this thing might work. You host this party, by the way, we didn't mention it in the intro that you guys are brothers. Which I think is really interesting.

Dos Toros | Leo:
I imagine a lot of listeners could already pull that.

Brian Scordato:
So I want to ask that question first before we get into more the restaurant stuff. We've had through Tacklebox founders who are married. Founders were brothers, brother sister that sort of thing. How do you think that dynamic helps or hurts?

Dos Toros | Oliver :
Giveth and in taketh. I think we've been incredibly fortunate that A, we've been lucky enough to be successful and open multiple units and that's kind of been the backdrop and framework we work in and so it's all positively framed because things are going well. But also I think there's a deep respect for each other and for the differences and similarities we share in the ways of thinking problem solving. We're a little bit of a yin and a yang.

Dos Toros | Leo:
Well then there's a lot of interaction or enjoyment. I would say like humour. Laughing. We had a really good relationship before starting Dos Toros, so that's a good sign. I wouldn't think that starting a business together with your sibling, if you're not actually that tight, is going to make it like groovier between you. So that was good, a good sign. And uh,

Dos Toros | Leo:
I'm does. So we simply like you have this exact same point of reference. Having grown up in the same place, in the same family, in the same house, in the same neighborhood, the same places you just have so many shared points of reference that I think it's easier to have a shared point of view or a clear vision that seems really sensible to both of you.

Dos Toros | Oliver :
We weren't eating at different neighborhood taquerias.

Dos Toros | Leo:
That's right, we were synchronizing, kind of our point of view on that. And then also you know, you don't have to be so diplomatic with your siblings, you just disagree more quickly or not worry that it is a disagreement going to lead to a rift in the same way. So you can just in some ways move faster.

Brian Scordato:
Sure. The trust thing is going to be huge. I mean that's when people look for a co-founder and it's someone you had you know had a previous relationship with. I mean it's tough to get to that level of trust that you obviously have.

Dos Toros | Leo:
It's a good point, and we really even hadn't thought about that. It's normal. And there's even stuff that you end up putting stuff in place to assure trust or the controls that you know what you're doing. You just have a time cost versus you know whatever, the actual cost.

Brian Scordato:
Yeah sure tons of cognitive overhead with a founder that you're not really sure about. Cool. So let's jump back to where it's now 2008 maybe 2009. And you tell me. Talk through the decision to open up a store. Open up the first physical location. Is there anything we skipped between the dinner stuff and the first location.

Dos Toros | Leo:
Yeah, a lot there.

Dos Toros | Oliver :
Ok. So I got that job at the local taqueria and coaching along their business but and then Leo got their a few months later and from there was a combination all of the different facets of starting a small business and starting a restaurant. So whether it was getting our legal documents or LLC form and all that or a lot more cooking we.

Dos Toros | Leo:
I mean we did recipe testing every day. And that was a constant, constantly tweaking recipes.

Dos Toros | Oliver :
And I remember going to the sixth street market to buy pork to ad crack the code on carnitas. And you actually had job at that time that I trained for you my whole thing. You come back to work. We'd make mistakes were slaving away over this recipe and then taking one little bite, it's too dry just sitting there shaving, every day.

Dos Toros | Leo:
Yeah. I mean certainly with a lot of testing and then a part of you know I think our obviously being inexperienced helpers in a number of ways more than that we didn't have any pride. or creative vision or in terms of like oh I know the best way to do to make beans. No we don't anyway let's try trying to be scientific and change one variable at a time and keep notes on what worked and what didn't and then try to be variable and just keep tinkering with it and not think that you know we had some artistic insight and also not feel the need to put our own stamp on it. We're gonna make this different than anyone's ever done before. We didn't feel that need.

Dos Toros | Oliver :
No, no sacred cows right. Except for our carne asada. Let's say the next day.

Dos Toros | Leo:
I think that's good that's good. So I a ton of recipe testing every day. But that guy we respect the legal formation in the bleep operation. That was. something that got the ball rolling. Oliver went to a

Dos Toros | Oliver :
It was "how to pass your first pre opening health inspection".

Dos Toros | Leo:
Put on by New York City put on right.

Dos Toros | Oliver :
It Was the NYC business express this really cool organization. I think it's it's morphed now and something changed.

Dos Toros | Leo:
But there were governmental services there kind of helped you get the ball rolling the navigating all the local. And so the speaker.

Dos Toros | Oliver :
And the speaker was A lawyer here in New York that does a lot of hospitality things, David Hallbron shout out and he's from Hallbron LD and they've based on a lot of the past 10 years. Wnd he was giving this free talk at this class down time 20 people. I think this guy's probably he's potentially the kind of price point we're looking for. And he was really really sharp and I'm totally on top of it. So after class I approached him and he represents us and it's a pretty small network of up and coming restaurant tour people and helped introduce us to our first accountant. Introduce us to our contractors. Yeah. And the whole ecosystem started with that class.

Dos Toros | Leo:
Right. And a lot of cases things aren't super googleable, especially supply chain stuff. You'd search like awesome restaurant contractor New York, maybe more so now but you know it doesn't there's just a lot of these kind of B2B main street players weren't really thinking about their online presence so you couldn't just figure it out from your computer. And I think there was a lot of stuff like that was sort of made a lot of people go through line with like exciting areas to get into business or that they're not easily duplicable right. That's an awfully built out opportunity. Probably changed quite a bit since we started calling guys. Maybe a stray thought anyway.

Dos Toros | Leo:
But Yes we built that network of people and target players and all the while products working on design, the logo design and the menu, the playlist. A lot of time on playlist, a lot of time on just like textural elements, like you know the tables and chairs and artwork and lighting and thinking about everywhere making notes, and everywhere with a tape measure in our pocket like making notes, measuring tables. A lot of time spent on table measurements.

Dos Toros | Oliver :
Chair height. This table, it's good but I feel a little far away from you and it's like 32 inches, so maybe we want more like 24 inch or twenty five inch sharing than what the table height. Twenty nine inches off again I'm not 27 gets. things like that.

Dos Toros | Leo:
And I'm taking notes and taking pictures kind of looks kind of board like inspiration and I think that was something that was going to give or take over those stories and their attention to aesthetic detail. Our mothers is an artist a visual artist. Just a really strong sense of style and I wrote off a little bit hopefully what we just are thoughtful paying attention to design and style is a really core part of the brand.

Dos Toros | Oliver :
How do things makes you feel?

Dos Toros | Leo:
Right, feelings that other things being you know our own core customer. We still feel that we are, really just we can refer to ourselves a lot. I mean we want to hear viewpoints and work it out but we still think of ourselves as like our core customer. So the thing we're thinking is actually do this do that. Is this the right song. Is this the right color of leather for the store. Is it can we get it before our kind of anything touched the customer. Right.

Brian Scordato:
I definitely want to get back to that. And I remember we spoke about this before. I live right near the first location and I used to go there like 2010, I think was when I started going maybe it's maybe like early 2011. And I remember noticing those details and I mentioned I remember there is a picture of you guys up on the wall. That was cool and very different. Like everything felt a little bit different like everything was way more thoughtful than what I thought the alternative which was probably Chipotle. And it was like night and day and I remember thinking like OK this is my place and I've since gone nine thousand times but I think,.

Dos Toros | Leo:
That's awesome and that's the dream. I mean, like that's the whole goal. Was to like, someone thoughtful like you is coming interacting with Dos Toros and you know appreciating all the kind of things we're thinking about and I'm like Yeah, these guys are my people. I think they get me.

Brian Scordato:
Yeah. So that came across. And that's I want to get into that. How hard that's gotta be. Because first I want to talk about before we get there. I was getting anxious just hearing all the things that you were trying to put together at that time between like trying to figure out recipes trying to figure out legal stuff. You mentioned that it's tough to find gatekeepers in interesting industries. I think that's totally still the case. It's got a gatekeeper to all the legalities around the restaurant finding the space all of that but then I'm sure there were gatekeepers to supply chain stuff too. You got to get all this stuff and it's going to go bad and there's like some who's gonna cook it. Like there's so much there. So I'm wondering how you prioritized early days.

Dos Toros | Oliver :
Little a little pro tip on supply chain stuff. If you go to a specific restaurant and you had something just out of this world you can just kind of. Camp out outside of. the truck comes the next time and see which truck it is much company. I mean we just call them up and ask about supply.

Dos Toros | Leo:
Well that's true. Just for a few hours, loitering, heavy loitering. That's right. Some site site selection to you. Oh you should be you take this piece of real estate. If you hang out for a few hours you can get a little clicky app on your iphone I'm sure we'll be able to walk into a restaurant and get a sense of what that by our what we can expect. If you're trying to build a profile. yeah real estate kind of collection is huge. You look at 40 locations where we got to we were 20 square where our first location.

Dos Toros | Oliver :
And nothing against the lower eastside but you know when we first came to the city everything was so new, traffic pattern residential versus its business versus subways are. How important was arteries. Are.

Dos Toros | Leo:
For sure I mean we saw so many locations that were really bad. When we finally were shown our eventual location by Union Square people were 20 to away or like how did you get out of divisional allocation to sport. That was kind of grungy back would you open there. We were like it was 10X than any location we saw.

Dos Toros | Oliver :
We also didn't know the fourth that was considered kind of grungy.

Dos Toros | Leo:
Just like a magical union square on location was like so much more just high quality foot traffic.

Dos Toros | Oliver :
I mean we looked at some terrible locations that we convince ourselves we wanted terribly. And we went for them and we lost out. We bid against other kinds of tenants that we went for was ordered and ended up not getting them.

Dos Toros | Leo:
And that ended up potentially right. It was huge swings of luck and every day is like nothing if we wanted to be like you would express that. So I was I was fortunate and this is probably also enabled by the fact it was kind of a recession right and this is thousand eight or whatever subprime crisis has occurred and there just wasn't a ton of action looking into good real estate. So a landlord would take a chance on an unproven operator like us.

Dos Toros | Oliver :
Yeah real estate this was lagging kind of the general economy and the stock market a little bit. And so but when we were looking or just looking inside of 2009 was like the best time

Dos Toros | Leo:
Right and rent was reasonable and that was Lucky also. I mean you obviously have to try and you have to take a chance to have be crazy lucky. But there's been a lot of fortune. and I've been... so coming back to the opening like it just became, we suddenly realized Oh all the design, legal and just restaurant equipment and supply chain whole thing and then we start to hire people like "oh my gosh this is just people, totally about people" and it just hadn't fully done enough like. Now as we what we were actually going to spend all of our time working on after the opening which was like hiring and training and connecting with and motivating a team. Building and building a culture with the team. It just. was kind of surprising.

Dos Toros | Oliver :
You went from having saw dust everywhere to having your first orientation where everyone standing around and it was like "hi guys". It was incredibly exciting. And. we've been incredibly fortunate to be able to find amazing people amazing talent and partially retain.

Brian Scordato:
So I'm curious how you created that initial playbook for culture. It sounds like you were in this to make really good burritos and done that but that's like one part of your product. The product is the space, the music, the design, the people who are serving you the burrito which is I'm assuming not the highest people in your business but they are the ones who are like client facing. I'm curious as to like what the role of a founder or couple of founders couple of CO CEOs when you're in almost a service industry, what what is that role look like?

Dos Toros | Oliver :
First and foremost I feel that Leo and I kind of humanists to the core and I think we are kind of hospitalitarians to begin with. We just care about people and make sure that everyone on our team feels included and feels safe and that we're right there with them and in our early days in the restaurant all of the time.

Dos Toros | Leo:
Right. If they're working and being kind, that takes you a hell of a long way in the early day culture building I think we really use the word culture for the first two years or we're screwe that. We were just a matter of working and being nice to our guests and to our team members and like that took us such a long way.

Dos Toros | Oliver :
Another protip, if you start a business whenever you go into your office or one of your retail locations whatever it is. Say hi to every person. Right. Which is insanely more than people... I don't know.

Dos Toros | Leo:
Maybe not a food service specific thing but since we just heard a lot that you know that a lot of places would just get people that would feel a particularly valued or seen as human beings.

Dos Toros | Oliver :
And I don't think those founders are so happy. You know it's like it's it's just it's not about not people first. Right. And you have to be.

Dos Toros | Leo:
So we are in there for sure. Just every every day you know sort of the first period of time and just there's no substitute for that obviously in memory of the fact that we connected with guests, understanding what's working or not working, iterating on stuff like the little things. I remember the first time we had a little of a traffic jam at the cashiers because our napkin dispenser was kind of up there and we were talking like oh you know we should just add another napkin dispenser by the back area and then, just it was this little tiny thing for the guest experience but it was like oh we use continually change little details as much as we want. b

Dos Toros | Oliver :
Because when the guest sitting by the front door have to go back to the cashier to grab napkins, that's a bummer.

Dos Toros | Leo:
That's a big bummer for everyone, for us, for them.

Dos Toros | Oliver :
And you know nothing is too small in terms of making improvements to the business into the flow. One thing in terms of that culture is I think is a huge huge part of it and probably the foundation is the product. And for us you know we started the business because of the passion for the burrito and that really was kind of the center point and that was the reason why we exist. It might have been one of the main reasons why we exist and that kind of unifies everyone's focus. Our guests get really excited about that product and that thing we're focused on and they give that energy to our crewmembers to our team. And then there's a kind of pride and excitement that comes on our side and it's this feedback that all comes from I think obsessive focus on passion for the product.

Dos Toros | Leo:
Right. It's funny you read like Simon Sinek or whatever, start with why. And it's like it's a profound truth to that, you know that there should be a bigger reason and that informs everything but like obsessing over product is can almost get the wrong thing. But that creates so much momentum and energy for the team, for the guest yeah. Start with what and what.

Brian Scordato:
So you launch you guys open the space in Union Square and I had a professor in business school who I was obsessed with the restaurant space and I wanted to start a company and I was like going to start something in the food space. And I went to this guy who is like our entrepreneurship guy in business school. And I told him my idea and it was was a pasta idea with a bunch of pastas and a bunch of sauces and sort of like mixed and matched and sort of each side of them. And he was like you know how you make a small fortune is you take a big fortune you open a restaurant. And even looking at your location as I've watched it for the last seven years or whatever, there have been small similar ish restaurants that have popped up and gone and it's like six months. You're packed, they're empty. And so I'm curious as to how you got customers interested early on because it's tough for me to even try something. So how did you think about saying we're going to get someone to stop at Dos Toros who has never stopped there before and turned them into a repeat customer.

Dos Toros | Leo:
Uh, well there is a couple of things. So location right. The cliche location location location for a reason right. Location we chose is really powerful. We're walking by and foot traffic a certain point you have enough foot traffic. I mean we would just walk in right you know what you do. So kind of that helps a lot. And I had a friend at Threllis, a big website blog you know kind of recommendation engine and then you know then they gave a promo for it. So we first opened this place. So that's. that's huge. That's leveraging personal connections and friendships to kind of help you get the word out. We didn't actually have a sign for the first couple months because our sign maker absconded with our deposit and like closed and left the country or something which was terrible.

Dos Toros | Oliver :
That was not cool.

Dos Toros | Leo:
So rough, but even before we had a sign and people kind of just mosey it in.

Dos Toros | Oliver :
Not that many.

Dos Toros | Leo:
But some.

Dos Toros | Oliver :
Some did, we had a vinyl outfront before that was cool.

Dos Toros | Leo:
Right. Right. So location a little bit early marketing, certainly we became keenly appreciative of the power of PR in the early stage. Just like various blogs that we kind of got mentioned on. And you could see it having an impact and then specifically a New York Times review that we were fortunate to receive a few months after opening.

Dos Toros | Oliver :
It came out of nowhere

Dos Toros | Leo:
It has happened and because of this.

Dos Toros | Oliver :
The writer, he had lived in the Bay Area for 10, 10 plus years. And then I actually played soccer with him. We share first name shot out he's the man. And he came in and this was his fourth or fifth visit and he came up to the counter instead of walking out after he finished his burrito. And he said "uh, just so you guys know, I'm gonna write you guys up. It's awesome. This is my Bay Area tacos and burritos. And he gave us this glowing review.

Dos Toros | Leo:
And we were like, yeah cool right no! That's awesome. But We kind of fully appreciate the power. And then he wrote you know that article came out a couple weeks later.

Dos Toros | Oliver :
January 6th

Dos Toros | Leo:
January 6th, thank you. And like it came out the next morning, and In the morning.

Dos Toros | Oliver :
So we'd never had anyone ever waiting for us to open. Right. So every morning we come in, start cooking stuff, open up get excited and then we walk in front flip the open closed sign. Walk back. You guys wait to see what happens today. Right. And that morning we went to flip the Open Close sign and there was a crowd of like 15 or 20 people just kind of waiting for us to open the door. Hey guys, what going on. We read in the York Times and want to try your burritos.

Dos Toros | Leo:
Oh my gosh. Everyone Get ready. So it's really just basically doubled our business immediately that day and didn't stop which was super amazing. Super stressful also we're like we were just continually running out of tomatoes salsa in particular. That happened just couldn't make enough And we just it was like you know it was wonderful, but it, You know there is too much to kind of like catch our breath and have any real expectation or ability to handle that kind of volume without a doubt. So that was incredible. And certainly PR has been a big one. I mean they're probably PR entities over the years and we just we're really always trying to stir the pot with that.

Dos Toros | Oliver :
Mm hmm. And just to talk back I talk about the location piece again for a second. You've got a lot of businesses can make the mistake of thinking that they're more special than they are or the people will go out of their way to interact with their business and we think we're awesome. We think we make the best burritos in the galaxy. We tried it but we still try to take locations that are as convenient as possible for our guests to meet them where they want to be back. And that's never going to never go away.

Brian Scordato:
It's interesting because a lot of our lot of companies we work with are tech products. They're digital. And that's a thing that we found over and over again is no customer especially early customers are going to set a single foot outside of what they do like what you did last Tuesday is what you're gonna do this Tuesday. And so you have to kind of like meet them exactly there and try and hijack them somehow. Like they're not going to go try something new unless it's so easy for them to do so. So that's interesting on the tech thing too I'm curious about metrics early on. Any like goals that you tracked weekly or correct me if I'm wrong but I think of Dos Toros as Probably a restaurant that relies on someone like me going there a couple of times a week for a long time. So how did you track or did you track if there were like repeat users if they were loyal customers vs new customers. And did that even matter I guess.

Dos Toros | Oliver :
It obviously mattered, more than anything. is attracting and creating regulars which you do and you try to do by just never compromising on quality.

Dos Toros | Leo:
We were there every day every minute like that you just bring people to it. But like journaling our digital like how we were tracking tracking loyalty. I mean we really have no actual data on what percentage people returned or are regulars. We know of just seeing our guests that you know more than half of them we've seen before and their regulars.

Dos Toros | Oliver :
Taking a contrarian approach I guess to this.

Dos Toros | Leo:
I mean suddenly we use we've had a lot of good news to kind of dig into data and we're just not going to spend time on it. Obviously we felt it was actually. like there had been moments where it was like hey why had the largest thing for you that turned out what we were of the chicken tacos that you sell 60 percent are to women and 40 percent are too men. Really. OK. I was wondered what I said ahead and I think my conversation point. But we don't know what to do with that data. And we've just been really really focused on delighting guests. So these are basically ever the awesome even like you know food comes through we all kind of like didn't have to figure out or I'm like kind of stopping or there was so many things that we kind of didn't understand kind of the importance of or just we're prioritizing and still kind of fundamentally with deprioritzed everything to what the guest experiences whether tasting what they're seeing or what they how they feel. We just got delighting in guests. It's always the priority to an almost you know to significant extent so there significant. Right. So that was our data point. So I think Gluton neighbor about the country good times in a measure like Gross National Happiness love that product family issues are a big metric for sure.

Dos Toros | Oliver :
Yeah but does Gluton for burrito right.

Brian Scordato:
I love that. So then that sort of makes the next part really interesting because you then start to grow you're like I got one location. It's time to open up more. And what was that decision like was a sort of a gut feel thing or were you always scouting locations in one opened up or how does that how do you know that it's working well enough to start spreading yourselves thin?

Dos Toros | Leo:
Again, so the place we were going to had multiple locations. So we felt like OK. We can do a few of these. And that was kind of all always the idea was hey maybe we can be that guy we are sitting out here five locations or more.

Dos Toros | Oliver :
But we had in mind and yet really starting with that that New York Times reviewed it got the bases started to work essentially right. And you had lines of guests, we're seeing a lot of same faces. I mean I think a few months after that it's when you guys are ok I guess we should start wasn't like OK let's do five locations in 2011. That was never really the thought.

Dos Toros | Leo:
We weren't rolling anything out ahead of kind of proven demand right.But once proven demand happened and sustained for a couple months and we were like "you know this is real". We immediately began thinking about right other another one spot real estate although it took us a year to find a second location.

Dos Toros | Oliver :
That we loved still love Father Demo square.

Dos Toros | Leo:
Demo? demo? I don't know

Dos Toros | Oliver :
It's right there at Sixth Avenue and Bleecker, Joe's Pizza That's right there and that's where our second location is. And we just wanted to be on the par felt we were next to union square with our first location.

Dos Toros | Leo:
There's also the other end of the NYU world.

Dos Toros | Oliver :
True.

Dos Toros | Leo:
And we felt like college students were really an important part of our guest is coming from Berkeley just out of college kind of cuisine.

Dos Toros | Oliver :
And then a Union Square subway station is the West Fourth station right there. Felt really good and so let's a long while longer than you would have liked but yeah that location opened in spring of 2011. The first one was October 2009 the next was 2011 and then the Upper East Side was the fall of 2011 . You know it was basically like Union Square is going great. How can we recreate that kind of feel you get hopefully a mix of residential, some office whether it's hospital by Lenox Hill side or Hudson's played out West Village and so we found those locations were sort of proxies to Union Square.

Dos Toros | Leo:
Then we only knew we weren't facing wrong were wrong we just took us a while to be right. And that was a surprise. Union, Union Square was really busy at that point until one of my school it's not that far away. We're in the center of our own universe. This is obviously a big news for the city. It's a momentous occasion. Let's start off getting bigger volume right. We also don't get out with every bell and whistle. Every little thing you didn't happen first of all it's rare and it's going be so great and we're super slammed. You have all of these things and then open it and just weren't that busy. I mean you know some students are going to get some action but not like Union square and realize that it's kind of like market ourselves. Do you not do that.

Dos Toros | Oliver :
I was down on 7th Avenue, who has come we've had some handouts.

Dos Toros | Leo:
We printed some handouts you know, designed some stuff, we're saying we're here we exist. Which is not a ridiculous thing to have.

Dos Toros | Oliver :
So I'm not like on Google Maps like put on that money. This is 2011. You literally printed the postcard like the one that.

Dos Toros | Leo:
I remember in one of my psychology classes and this there was an experiment on getting people to take action. And it was random like go get a you know information on STDs or America was some kind of collegiate Student Information Session and a ton of more success if you get a map. of the Coast Guard when they didn't October or whatever. You definitely have a map.

Dos Toros | Oliver :
It was just a little zoom in the last boat star. Right. Be very kind of I. And then we were out there. Yeah. And ow that doesn't mean that's not for sure but the more the bigger growth just took time to build out ideas and converted regular one at a time, one burrito at a time for a lot. And it's really true every single cast is not planning to build a regular or not.

Dos Toros | Oliver :
And as you alluded to earlier you know, regulars are bedrock and the foundation of any successful food business almost any successful business and you fellow and you cultivate your base by focusing deeply and mainly doing stuff to.

Dos Toros | Oliver :
Every week to do delivery. We started delivery didn't work. Catering was not on our radar. We started catering and there was a number of really significant parts of the business and it was kind of driven by needing to find ways to add revenue and awareness.

Dos Toros | Leo:
And the upper eastside, similar, it opened up collective yawn or something. Yeah we thought the west village was bad, but the upper eastside was also quiet. And like Upper Eastside was even more so just like or maybe a little more culturally conservative but they want to be there for two years before they try you out.

Dos Toros | Oliver :
And if they don't try you out than you're not going to make it.

Dos Toros | Leo:
What's the catch 22. And then same thing with marketing or marketing. You're talking to local schools or you know women in a doormat. It really is just a job. Anything we can think of any easy even now or I'm remembering stuff the doorman building right now. And there's a constant danger of forgetting hard stuff that you did to get to where you are not as you go forward and stuff.

Dos Toros | Oliver :
You my office.

Dos Toros | Leo:
I was totally in it but it's like going to a school kind of reverence where like you're the test you study really hard and get an A, Second test you're like I'm so good at this, you get a C and because you forgot how hard you studied the first time then you remember.

Dos Toros | Oliver :
I think that's part of the story.

Brian Scordato:
So you now have many stores do you guys have?

Dos Toros | Leo:
We have 20 locations. 16 in New York for two of those excuse me in Brooklyn and then we have four locations in Chicago.

Brian Scordato:
Wow.

Dos Toros | Leo:
And opening number 21 on Madison between 40th and 41st first in a week and a half on the 13th. Five dollar burrit0.

Brian Scordato:
Nice. So it sounds like early days you had your thumb on stuff like you were able to really control and watch how the stores worked and operate here and be able to make little tweaks. How do you replicate that when you've got this many locations. you can't do it. Was it like a couple of specific hires or like playbook stuff for how do you duplicate. It's crazy.

Dos Toros | Oliver :
Every hire at Dos Toros is a key hire.

Dos Toros | Leo:
Well said that's true but there were in addition to that there were key hires you know just hiring operational leaders that just had real experience you know we thought we always see this expression you have enough inexperience to go around, the whole company. So we're going to let everyone else be experienced and know what they're doing and hopefully through some combination of working together they'll be able to kind of draw on their knowledge and insight and will be able to draw on our lacking knowledge.

Dos Toros | Leo:
So I challenge assumptions that maybe shouldn't be held and writers are good positive stuff. I think also we just you know we didn't think we were better than anyone at anything, we pretty much weren't. So it was no problem delegating stuff or like something wrong. You know what I'll just I like the grill because I'm the best person at grilling chicken. No I'm probably the worst at it so. All right. Yeah right. It's empowering. Kind of not. We weren't better at doing stuff.

Dos Toros | Oliver :
Maybe I'm kind of thinking this as you were mentioning trust earlier we've had this bedrock such deep trust each other maybe that permeated from us to throughout the organization trusting people.

Dos Toros | Oliver :
There's a culture of trust and a belief that people execute but always trust and verify the experts. Trust is earned.

Dos Toros | Leo:
Totally. So we certainly invested time in training realized like half of what we do is in the education space. And so we've gotten really into training with this kind of learning management system is very much a video content all embedded in there, you can kind of test tests, watch videos and through the them learn it and get certified and stuff. All the rigorous kind of steps of training and verification that are really important and the videos are fine. That's a cool thing. I that you can shoot video on your iPhone looks great. Sounds fine. And what a great way to teach how to make chips with video. Instead of writing about it or talking about it to show it.

Dos Toros | Oliver :
A lot of what we do is do physical and hands on that watching somebody do it as opposed to beating about it is A lot more effective. Cool.

Dos Toros | Leo:
Totally the training is huge. Also yes we are ,We're bigger now with 20 locations you still kind of get your arms around it you can be anywhere on some reasonable kind of frequency. I was going through those yesterday right. Totally. We're in there. We're both taking catering orders tomorrow. We still do stuff in the field and I just think you know we want to be bigger than we are. We don't want to be anymore. Who want to try to be smaller than we are culturally.. So we don't want that. We're not trying to look ahead to like a place where be more we're going to find ways we just get closer.

Brian Scordato:
That's really interesting. I love that. I'll finish with two questions which are going to go a little higher level. I'm an essentialist so I believe that I truly believe that like 99 percent of what we all do it doesn't really matter. Like we're all kind of doing the same stuff and it all cancels out. But there is one percent things that you do that drive everything. Has there been anything that has been in that 1 percent category so like anything that you've done that you think has had just an outsized role in does tourists now having this many locations being the successful and delicious me.

Dos Toros | Oliver :
I would probably say that I feel have just sandwiches still rolling burritos on the service line you know not a lot. Maybe it's an hour during the lunch rush once or twice a week bouncing around locations. I'm just saying that you know that's how I keep an eye on our product. You know whether it's a new pop up foil that we're using to roll our burritos in and whether it's 64 major 66 gauge thickness but making sure that it's taking out the you write out with a Sharpie on the foil doesn't break through. Is it just like the littlest details of our product. I can kind of. in real time work with those in the field and the teams I think other other companies don't want to take it further than the product.

Dos Toros | Leo:
Cool. And no matter how many locations we have it's just that number of times acts and acts as the kind of concept before well concept. So how we do what we do. And I think to stay close to it has been enormous. And there might be some entire room talking about something or you how I was doing that thing and verifying what is or isn't working seeing pretty quickly what what's good or bad. And that's the most fun.

Dos Toros | Leo:
But also I think we're just inherently kind of seems like we're like kind of disruptive because we're just outsiders and kind of embrace our outsiderness and just are always open to doing something differently or thinking about it differently and trying to evolve the times we can overall get something that can be very simple or who is a smarter way to do this. But we just are always challenging the status quo especially for our industry of how you can build a culture or build a restaurant or you know design a marketing campaign or things like that.

Dos Toros | Oliver :
We're just kind of yeah we get it this is why something has been done this way in this industry for many years but why and have things changed. Can we be exact.

Dos Toros | Leo:
We're also pretty good at saying no. Talk about the power of no. You say no so you can say yes. You know it frees you to focus on the central things. I say no to a whole bunch of stuff over the years not a whole lot of things. Proposals kind of come our way and ideas and just you know unless we think it's we just can't get away from it becaue it's so compelling. We just say no.

Dos Toros | Oliver :
And you can just blame it on the other brother. I want to discuss this. Yeah you like that guy. He's tough and scary.

Brian Scordato:
I like that as you guys are talking I kept on thinking that saying when you're mentioning that you kind of outsiders to the industry the saying of like it wasn't a fish that discovered water. I think that's pretty sort of potentially relevant to you guys. So I do want to ask the last question that we asked all of our founders which is if you were going to start a taco truck how would you approach it. I'm trying to think of a way to make it a little bit tougher for you guys.

Dos Toros | Leo:
So I think I don't worry plenty tough question for us.

Brian Scordato:
OK we'll just leave it.

Dos Toros | Oliver :
I mean first thing that comes to mind for me is limiting choices and limiting options and we actually we don't serve fish or shrimp tacos in our taquerias, I would do that. That's all I have to say about that.

Dos Toros | Leo:
Great, I mean. Yeah. All right. Super laser focus. Just try and pare down to as few as possible items that you're serving. I would go to a whole bunch of other trucks, taco trucks and otherwise you can see what's cool about their service, style, redesign and where they park and

Dos Toros | Oliver :
Not to not to talk down what you're saying earlier about the pasta concept you're talking about really. It's awesome a bunch of sauces and a bunch of pastas and you can combine what you like and I feel like a lot of fast food a lot of concepts are kind of going in that direction or have and it can be big trouble too short to have and like me think about recessions seven million to eighty thousand permutations like waste water from the center and pairing it down that you can just make a lot of time to be served next year.

Dos Toros | Oliver :
But it's not like that.

Dos Toros | Leo:
No no no no was hugely about limiting choice to making our decision to not have the two options for just have to watch whenever we think we can do that. So yeah I mean I think a lot of parking with this taco truck. Where am I going to park, where do i want to be throughout the day where will we park overnight.

Dos Toros | Oliver :
Right overnight, that's a big one.

Dos Toros | Leo:
Where can I find a used truck you know going to happen and kind of probably the greater the thing on that I think you'd want to take a karate class and everybody gets pretty intense out there with trucks with other truck owners will fight you to force or forward to parking stuff right to issue. Checking your Twitter feed crashing. No.

Brian Scordato:
I think that's a cool way to think. I think like founders are constantly thinking through this stuff and that's how you'd approach it. I think that's awesome. Focus, location, it's all stuff that is relevant to what you guys have done successful with cool. This has been so awesome. I really appreciate it. I could not recommend, I'm getting so hungry just listening. Like when you mentioned the tacos before the Dos Toros tacos I was like oh my god I need to get a taco. Everyone that's listening should go to Dos Toros immediately. What's the best thing you got on the menu?

Dos Toros | Leo:
Well we really do recommend the carnitas burrito because it's kind of our signature. This is a labor of love. Yeah. Pretty differentiated.

Dos Toros | Oliver :
Yeah and make sure you throw some guacamole on there and then somehow hot sauce

Brian Scordato:
Awesome. Thank you so much appreciate it.

Dos Toros | Leo:
Thanks Brian. Pleasure.

Brian Scordato:
Thank you for listening to Idea to Startup a podcast brought to you by Tacklebox. Check out get Tacklebox dot com and click on podcast to see the show notes for this episode and all of our episodes. Also as always shoot me an email at Brian and gettacklebox.com with any questions. With people I should interview with questions about your love life whatever you want. All right have a great week.

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Episode Description:

Today, we’re talking burritos. Leo and Oliver Kremer founded Dos Toros in 2009 because they couldn’t find the Mission-style burritos they grew up with on the west coast anywhere in NYC. However, they weren’t cooks and had never been in the restaurant or food space.

We talk to them about the early days - about validating the need, creating the supply chain, getting into brick and mortar, creating a culture, and growth. It’s an awesome, helpful, and inspiring conversation. Enjoy!

Show Notes:

If you’re in NYC or Chicago, grab a burrito at Dos Toros.

 
 

You can find this and all future episodes on iTunes and here on gettacklebox.com/idea-to-startup.



Brian Scordato